The era of “benign neglect” of home-prices boom is over, says the International Monetary Fund.

But if that’s true, the premise could soon be put to the test. The IMF’s global house price index shows that prices rose in 33 of 51 countries measured last year. Broad measures of housing affordability, which include comparing home prices to their long-run relationship with rents and incomes, show that home prices are moving “well above the historical averages” in several countries.

Relative to their long-run relationship with rents and with incomes, prices in Canada, New Zealand, Norway, Belgium, Australia, France and the United Kingdom are well above average.

Prices are roughly in line with the traditional price-to-rent ratio for the U.S. and they look undervalued on a price-to-income basis. Prices look undervalued on both metrics in a handful of countries, including Japan, Portugal, Slovakia, and Germany.

The IMF on Wednesday launched “Global Housing Watch,” part of an effort to curb complacency among regulators and policy makers about housing booms, which can help boost economic growth—both through increased construction and consumer spending—but which can have painful after-effects, as the U.S. has learned over the past decade. Min Zhu, an IMF deputy managing director, authored a blog post optimistically titled, “Era of Benign Neglect of House Prices Booms Is Over.”

Price-to-rent and price-to-income gauges have their limits, says Mr. Zhu. In Belgium, for example, where prices appear badly out of line relative to incomes, risks of a sharp correction appear contained because more detailed market data shows a more modest overvaluation than the price-to-income and price-to-rent ratios would suggest.

Regulators have focused more attention on home-price sustainability in the aftermath of the U.S. housing bust that triggered the 2008-09 financial panic. The IMF says its research shows that “boom-bust patterns in house prices preceded more than two-thirds of the recent 50 systemic banking crises.”

So what can policy makers do to curb runaway home-price growth? One tool, of course, is microprudential regulation, or ensuring the capital adequacy and safe operations of individual financial institutions.

But that isn’t often enough, says Mr. Zhu, given that “actions suitable at the level of individual institutions can destabilize the system as a whole.” Regulators can use macroprudential policies, he says, to improve the resilience of the broader financial system.

These policies include imposing maximum loan-to-value ratios or debt-to-income ratios and limiting certain products, such as adjustable-rate mortgages. They’ve been employed in recent years by central bankers and regulators in South Korea, Israel, and Indonesia. Other countries, including Ireland, Norway, and Spain, have imposed higher capital requirements for real-estate loans with high leverage.

“Though evidence thus far suggests that macroprudential policies are effective in the short-run in cooling off housing markets, it is clear that honing them remains a work in progress,” says Mr. Zhu.

As a last resort, central banks can raise interest rates, using monetary policy to cool housing booms. While this may involve some tough trade-offs for central bankers, “monetary policy will need to be more concerned than it was before with financial stability and hence with housing markets.”

But regulators can only do so much, he added. Britain’s biggest problem, he said, is that the nation hasn’t built enough homes to meet demand. More housing “would help us out,” he said. “We’re not going to build a single house at the Bank of England.”

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